Management Accounting - Study Mode
[#196] If tax operating income is $885000 per year and net initial investment is $35750000 then increase in average is
Correct Answer
(D) 2.475% per year
[#197] If actual price input is $700, budgeted price of input is $400 and actual quantity of input is 50 units, then price variance will be
Correct Answer
(A) $15,000
Explanation
Solution: Price variance = (actual price input - budgeted price of input) × actual quantity of input = ($700 - $400) × 50 = $15,000.
[#198] If actual input price is $150 and budgeted input price is $80, then price variance will be
Correct Answer
(B) $70
Explanation
Solution: Price variance = Actual price input - Budgeted price of input = $150 - $80 = $70.
[#199] Standard input allows one unit, to be divided by standard cost per output unit for variable direct cost input, to calculate
Correct Answer
(A) standard price per input unit
Explanation
Solution: Standard input allows one unit, to be divided by standard cost per output unit for variable direct cost input, to calculate standard price per input unit. A standard cost is described as a predetermined cost, an estimated future cost, an expected cost, a budgeted unit cost, a forecast cost, or as the "should be" cost.
[#200] Consideration of decreased operating income relative to budgeted amount in static budget is classified as
Correct Answer
(D) unfavourable variance
Explanation
Solution: Consideration of decreased operating income relative to budgeted amount in static budget is classified as unfavourable variance. 'Unfavorable variance' is an accounting term that describes instances where actual costs are greater than the standard or expected costs.